Category: Economics

How much decision-making should be privately made, vs. collectively? Arguably, decisions that affect most of us ought, in some way, to incorporate input from the public.

But as Elizabeth Warren 2020 (!!) notes — it’s getting harder and harder to do that, even as economic opportunities dry up and the wealthy capture more and more of the political class.

With Cory Booker, Kamala Harris, Joe Biden, and Bernie Sanders all exploring bids too, it’s shaping up to be a very interesting 2020 indeed. With so many all-star Democrats in this mix, it’s hard to imagine we won’t come out of this with an interesting campaign season — beginning approximately now, with Warren’s semi-official entry into the arena and owning the airwaves as Trump comes unhinged at “Pocahontas.”

She dressed him down easily, gracefully, and quickly — before moving on into substantive economic issues most Americans are going to want to hear a lot more about. Trump cannot speak this way about the economy, which means his ruse on the Hillbilly Elegies of the world is about to come to an abrupt end, with many of their rude awakening.

For some it will never dawn on them that the man of the golden toilets (and golden showers!) who inherited hundreds of millions of dollars from his New York real estate mogul father before bankrupting himself 4 times in the casino business, in point of fact can in no way understand their experience living in a motor home or ramshackle apartment complex in some run-down suburb in the rust belt. But many may finally see that he’s just been pretending, like all the other rich people who still rule their damn lives despite all the promises to “drain the swamp” of corruption.

We have endured much together these past 2-3 years, Team America. Thankfully our civil society is incredibly robust — and time is accelerating demographic gains in an inexorably democratic direction. As Boomers give way to Millennials — slated to happen as early as this year — we are experiencing a seismic shift in the national consciousness.

Look out, Boomers!

Our values as a nation-state have always been evolving as the political consciousness and cultural landscapes shift, but in recent political times the changes have been radical, seemingly sudden, and jarring in a way that collective memory does not easily recall. I believe we are witnessing the swan song of a generation — the largest post-WWII generation dominant demo for decades, now facing only the long decline.

Much is said of the Hillbilly Elegies of our country, but to be fair these elders are legitimately terrified: of the U.S. they see around them today — bearing little resemblance to the nation of their boomingly patriarchal childhoods; of the world outside our borders and the immigrants (theoretically; allegedly) streaming into them illegally; of long disused portions of America drying up and economically (and in some cases literally) tumbleweeding away; of their own impending mortality.

We go high

Michelle Obama was right. Is right. We should make ourselves aware of the kinds of games the other side is willing to employ, but endeavor not to play them ourselves as much as we can. But beyond a moral reason to love thy neighbor, there’s the practical matter that we may find common cause in surprising territories. Non-wealthy elder whites and young Millennials who struggled through the 2008 housing and banking crash both have reason to want a robust safety net, for example. This is the essence of democratic politics done well: coalition-building — not among special interests, but among elected leaders representing their constituents in good faith.

The arc of justice

…goes at its own pace, or something like that. Fascism has a creep (or at the moment, more of an open stride), and justice has a methodical process of evidence-gathering and weighing; we can have some solid faith in the latter to do its work. Regardless of the levels of bitter partisanship in the air, we have an enormous cadre of professional civil servants who do their often thankless jobs tirelessly for years and decades out of the limelight, for sub-private sector pay and little recognition. This cohort works tirelessly for us now, investigating the many tentacles of the Trump corruption operation stretching back years and decades into American life and foreign investment.

Mr Mueller, do your worst. By which I mean your best. We understand each other, I think. 👍🏽⚖️

Some people like to argue that more economic inequality is a good thing, because it is a “natural” byproduct of capitalism in a world of “makers and takers,” “winners and losers,” “wolves and sheep,” [insert your favorite Manichaean metaphor here]. However, too much inequality is deleterious for both economics and politics — for reasons that are intertwined.

Those who amass exorbitant wealth often increasingly use a portion of their gains to capture politics. While the mythological promise of trickle-down economics is that we must not have progressive taxation, because giving more money to the already wealthy is the only way to spur economic investment and innovation and create jobs — in actual fact the majority of tax cut windfalls go to stock buybacks, offshore tax havens, regulatory capture, political lobbying, and campaign donations. All this is a runaway amplifying feedback loop that tilts the playing field further away from equal opportunity, social mobility, and democratic process.

Wealthy elites seek to preserve the power structures that have benefitted them, and keep them (and their descendants) in the ruling class. It is a slow recreation of the aristocratic societies of old Europe that we fought a bloody war of independence to separate ourselves from. Yet the erosion of civil values, public engagement, and collective will — largely as fomented by the conservative elite over the past 50 years in America — and the ascendancy of the myth of “rugged individualism” have conspired to create a perilous condition in which corruption operates so openly in today’s White House and Wall Street that democracy itself is in great danger.

Moreover, we have learned these lessons once, not quite a century ago, yet have forgotten them:

“Where there is a crisis, the ruling classes take refuge in fascism as a safeguard against the revolution of the proletariat… The bourgeoisie rules through demagoguery, which in practice means that prominent positions are filled by irresponsible people who commit follies in moments of decision.”

Dictatorships generally do not foster, or even tolerate, the kind of creative disruption of the status quo necessary to the existence of a dynamic free market. Plus, the economy of the Russian state can best be described as a kleptocracy. Thus Vladimir Putin needs to find other ways to shore up both the national finances and the support of his cronies (much less so, of his people, who are primarily afterthoughts in the Russian power structure).

Here is a granular look at major indicators of the economy of the Russian Federation.

There is no point belaboring a “stop the identity politics!” argument because there is simply no way to excise the political clash of factions from the identities of those factions. There would be no point in clashing if there were no identities.

There is no polity without identity. The root of the word itself in ancient Greek referred to the relationship between a citizen and the state, and the rights one has in relation to that state. Whereas individual communities have historically had rights infringed — often precisely because of their identities — it is of course a logical imperative to defend one’s rights under the rule of law. You use whatever tactics are available to you and that your ethics comport with to get your rights. All factions would do the same.

Some might say the predominant historical thread since the founding of this nation is the gradual parity-seeking of the many groups that have migrated here over the past 241 years (and much longer still, before that). Most of them have had a long, hard road; many of them still do; and still new groups are becoming the focus of persecution in America as time goes on.

Economics is also identity

How does one even have a political position without an identity? I often hear “economics” presented as the “alternative” to discussing identity, as if one’s economics can be separable from one’s identity; as if economics is separable from history (or as Jefferson called it, the “dead hand of the past“); as if economics is separable from one’s nationality; as if one’s choices in life have no relation to one’s station, or aspiration.

James Madison himself believed the unequal distribution of property was itself the most common cause of factionalism. There aren’t a lot of rich socialists. There aren’t a lot of poor Libertarians. So it goes. The question isn’t whether or not we talk about identity — the political question is “whose identity(ies) do we talk about?” Who gets resources, accolades, airtime, contracts, lucrative careers, investment funds, bailout funds, bail funds, etc. etc. Who gets rights, and who doesn’t.

There are mathematically-speaking two predominant positions one can take on this question:

we all have equal rights

some groups should have more rights than others

The former position is the classic view of liberal political philosophy (not to be confused with liberal economic policy, with which it is much conflated to all our detriment). The latter position is a belief in supremacy. Typically, this belief is accompanied by the belief that one’s own group is, of course, the dominant group and that other groups are the inferior groups that ought to be generally submissive to the in-group. Unsurprisingly to game theory or statistics, each faction tends to have such believers amidst its distribution of policy positions and political leanings. Some are more militant than others (quite literally).

Clearly the nation’s founders in any of even the most skeptical reads believed in the former, however, and intended it to be the law of the land for their fledgling republic:

Whether we can live up to it is the question still, as it was when it began. In our time the “question” appears to loom large once again — a time when it is convenient for the powerful and wealthy to avoid even sharper scrutiny from a public set against itself like dogs trained for a fight. We all must have an answer to the question: equality or supremacy?

Much has been said regarding the so-called laziness of the poor. Hands have been wrung, glasses have been drained, Davos hotel rooms have been trashed year after year in elite consternation over The Perennially Perplexing Plight of the Poor.

Meanwhile in the American political landscape, the answer is already clear:

THEY’RE NOT WORKING HARD ENOUGH!!!!

But perhaps there’s some confusion over what is meant by the term “hard work” — certainly it’s ambiguous, and no one takes a pause in the middle of a vigorous, breathy debate to define their terms, curiously. So, for the barely literate cretins out there who can barely manage to hold down a job much less participate in the ever-prosperous U.S. economy — a visual guide:

The creator of the also excellent Century of the Self film series released his latest film in October, 2016. Dubbed HyperNormalisation, it offers both a history lesson of the complicated relationship between the West, the Middle East, and Russia, as well as an unflinching look at the roles played by technology, surveillance, and the media on our modern condition of general confusion, destabilization, and surrealism.

Regardless of whether or not you agree that slashing spending, fiscal austerity, balanced budgets, and a low federal deficit are good ideas, the fact remains that the Republican Party does not generally live up to its aims of expense reduction and small government.

As hard as it is to believe, there are still some people who think that Reagan cut the size of government, although Reagan was a big spender and laid the groundwork for the immense national debt we live with today.

Then there was Ol’ Dubya with his two disgraceful wars, TARP bailout, auto bailouts, fiscal stimulus, and tax cuts. Not to mention yanking the election out from under Al Gore’s popular win via a leg up from Florida governor brother Jeb.

Turns out, not even gridlock is a decent strategy for preventing escalating expenditures, under the theory that not getting anything done would prevent the government from growing. Apparently not:

Total gridlock is the worst outcome, where impact to the budget is concerned. Total Democratic control of the White House and Congress is the most fiscally responsible since the presidency of Richard Nixon. So the idea of Republican leanness is a fallacy whether you believe that’s a worthy goal or not — and there’s a lot of evidence to suggest the tide is turning toward a wider appreciation of John Maynard Keynes’ approach to sensible fiscal spending when there is unemployment (puts idle resources to work and reduces government welfare expense; gives people a sense of purpose; builds community), if it is accomplished by debt financing (i.e., issuing Treasury Bonds — allowing individuals, pension funds, and so on to invest in the United States as sort of national asset class) and is used to build goods and structures that benefit the public at large: infrastructure, research and development, public resources, public health services, job training, paid volunteer work, parks and public spaces, etc.

Keynesian and Classical theory have oft been at odds, but are better understood now as complements: in a healthy, roaring economy, government should take its boots off the throttle and avoid tipping over into the kind of speculatory gamesmanship that got us into hot water in 2007-8. But in a depression or recession, or when the economy is recovering sluggishly, it should be a goto solution to start thinking about where to apply government funds (i.e. our money!) to things that need doing anyway; services that invest in our economy’s greatest resource: its citizens; programs that position us for the future by having the luxury to think ahead boldly.

Although the economy has recovered nicely for some — especially those in higher tax brackets — it has clearly left a number of Americans behind. It’s only added to a trend that had already started in the 70s, when inequality began widening in the U.S. The populist white, nationalist ire unleashed in the 2016 presidential election was something perhaps few saw coming, even though in hindsight the far right has been whipping their base into a frenzy for years — arguably since Reagan, if not with Nixon. That means there’s still a healthy place for government spending, especially in areas we already know we’re in sore need of a boost: roads and bridges, a public health care option, basic research, advanced manufacturing, the pivot to a renewable energy economy, to name a few. Luckily, that’s what Hillary Clinton wants to do:

Use the revenue from closing corporate loopholes and cracking down on tax inversions to invest in small business, long-term growth, R&D, advanced manufacturing, and job training

Manufacturing Renaissance Tax Credit: to help revitalize communities hit hardest by the collapse of manufacturing

Create an American Parks Trust Fund to invest in the country’s natural preserves

Restore and refresh more than 3000 city parks within 10 years

Create a new Water Innovation Lab and a Western Water Partnership to help manage our water challenges over the coming decades

Become the world’s clean energy superpower: install more than half a billion solar panels by the end of term 1; generate enough renewable energy to power every home in American within 10 years; create a grant and award-based Clean Energy Challenge with states, cities, and rural communities; Solar X-Prize; tax incentives for renewables; foster energy innovation

Help build the new tech economy on Main Street: create a lifelong learning system more geared towards 21st-century jobs; invest in STEM education; invest in science and tech R&D; help ensure benefits are flexible and travel with workers, not their employers; commit to 100% of households with broadband access by 2020; deploying the 5G wireless network; building free wi-fi infrastructure in punlic places and transport hubs; launch digital community projects to improve connectivity more affordably

Expand the role of national service, both paid and volunteer, with expansions of programs like the Peace Corps, AmeriCorps, Habitat for Humanity, the Red Cross, and the creation of a National Service Reserve for millions of Americans to contribute volunteer time to local challenges in their own communities

#ImWithHer
by the way: Her plan plans to finance itself by making wealthy individuals and corporations pay their fair share in taxes, and would not appreciably add to the deficit beyond any existing projections from the OMB;but here’s the best explainer I have found about whywe should seriously loosen our collars over the national debt.There is no reason to pay it down; and indeed, it would be dangerous and deleterious to even try to, because we’d be starving the economy of the circulation it needs to keep operating and growing:💰money💰.

There’s a popular and somewhat understandable misperception of culture as a vehicle of reproducing “normalcy” throughout society. However, each historical era makes the cognitive mistake of assuming its particular version of Normal is, well, Normal. And that all eras which came before — that were obviously ruled by stupid people who could not understand the kind of objective truths we are now privy to in the New Modern era — were a series of mass delusions in which people fooled themselves into thinking they had The Answers, when they so clearly didn’t. Because The Problems continue apace.

The twisted social psychological paradox we have not yet managed to escape is our abject failure to understand that we Moderns, too, are trapped within an enormous cultural projection of our current set of utopian delusions. We are no different, nor more special, than all the well-intentioned optimists and sad charlatans of bygone eras we love to thumb our elitist noses at. But our cursed cross to bear is the historically inescapable belief in our own Exceptionism — that we are The Smartest Guys in the Room, and that our newfound flavors of scientific rationalism will allow us to Save The Day and prop ourselves up as the hero gods of humankind we deep inside know that we must be.

For how can it be otherwise?

Whether God created us or we Him, it hardly matters — both narratives serve our deep-seated psychological ends: to prop ourselves up as the Platonically pure forms of human perfection we are eternally striving to be, despite all available evidence to the contrary. Whether mere mini-Gods or True Gods ourselves, we puff ourselves up with the pride of our uniquely gifted creationism vs. other species (and when it suits us, Other races, genders, ethnicities, or other demographical lenses that may be wielded to set The Best among us apart), which (in our minds) serves as the supremely obvious evidence of our planetary — and possibly (hopefully!) galactic — supremacy over natural reality.

All of this has happened before

But even a shallow skim through history could easily produce ample evidence in support of the opposing idea: that all such delusions of grandeur are false — which is part of the reason we (technologists, especially) love to avoid consulting history regarding such matters. The social proof of accolades in the Here and Now is far more exhilirating and, of course, less depressing.

And why look to the past, when all that is accessible can only lie before us? Yet both perspectives are false — neither the past nor the future are truly accessible to us. We live ever fixed within a singular bubbling moment of spacetime we have only barely begun to comprehend. In fact, all that our intellectual and scientific machinations have managed to reveal to us is the staggering lack of edgeness at the edges; and that the more deeply we pursue any sort of objective insight into any subject, no matter how narrowly defined, the more we only find an ever-widening gulf of ignorance opening up as if to swallow us.

Such is the fractal nature of reality, that it seems to slip further from our grasp the harder we struggle to know it — like flies in a vast inky darkness of transfixing ointment. Take for example two of the most theoretically “objective” fields known to modern scientific inquiry, and ask for their practitioners’ opinions on how the imaginary “coefficient of certainty” in their domains (that I am just now making up; bear with me — for you see, I too am a mini-God with powers of creation! Voila!) has fared over recent decades. They’re liable to tell you that physics only seems to be getting stranger, while mathematics may be brushing up against the limits of computational irreducibility, leaving a host of fundamentally unsolvable problems (although Stephen Wolfram does nonetheless leave us with ample hope of an infinite amount of discoveries to be made within the remaining territories of computationally reducible systems that we can continue to practically soldier on in. PHEW!).

Where shall we look for the Normal?

Outside of heady intellectual computational theory and the often esoteric pursuits of hard science, there is still a planetary majority of people who simply aren’t interested in this particular method of asking questions about the deep mysteries of life. Far from being irrational clods who lack the cognitive capacity to understand engineering and complex equations, they are seeking — and many have found — their answers to the profound mysteries of the meaning and purpose of life elsewhere, in other domains.

Whether it be hearth and home, creative pursuits, caretaking of others, careers and/or inquiries into other fields, or any of a dizzying variety of alternatives to the purely scientific-relational approach to values: these people are not wrong. They are not misguided, or necessarily simplistic in their searches for meaning — and neither is a simplistic approach itself objectively worse than a complicated one. In fact, as the economist-turned-philosopher Nassim Taleb so compellingly argues for via the concept of antifragility, our modern, rationalized, (predominantly) Western tendency to hyper-complexify matters often only ends up making things worse. We can’t resist the urge to meddle, and insert ourselves into the micromanagement of many processes that ought to be left well enough alone, such that the natural, organic forces of time and randomness can perform their mysterious acts of self-healing.

Instead, we exhaust ourselves with frantic over-interventionism in our quest to “smooth everything out,” eradicate the uncertainties of risk, and tamp down the erratic edges of non-conformity into the kind of straight lines and perfect curves that makes it easier for us to manipulate them within our clever mathematical models. We embark on ever more ambitious projects of forcing people to fit the models we create, so that we may pat ourselves on the back for our obvious brilliance and sophistry with prediction (and, of course, justify the collection of enormous financial rewards for being so clever).

When some people begin to rationally feel spiritually and emotionally lost within this framework, scientific rationalization once again comes to the “rescue,” via medicalization of a vast and growing array of commonly routine experiences and phenomenological traits. From the most trivial and mundane “disorders” such as “inadequate or not enough eyelashes” to the more Orwellian “oppositional-defiant disorders” that tend to land the less obsequious amongst our children on a regimen of expensive drug cocktails, Big Pharma has got The Cure for YOU!

Whatever malaise afflicts the less engaged portion of the population that isn’t quite sure about the necessity of all this excessive (and fabulously profitable) interventionism, there is sure to be ample pharmaceutical “assistance” available in pursuit of learning to appreciate the New Normal — whatever the New Normal becomes at the behest of powerful corporations and the political minions who serve them via armies of lobbyist Slugworths whispering self-serving plans into the ears of the global elite whilst writing dark money checks in smoky back rooms (of course in my imagination, the global elite have flouted society’s pathetic insistence on protecting the plebes from the dangers of inhaling the carcinogens that afford sociopathic business “leaders” with their well-deserved profits — they retain the right to smoke indoors, goddammit!!).

In other words, Normal is merely what we decide it to be, whether by collective decision or by imposition from a cabal of powerful forces whose colossal self-interest bias has created one of the largest systematic exploits of the principal-agent problem heretofore witnessed in history.

We no longer even recognize the war we’re fighting

Our spoken or unspoken desire to dominate all of civilization through the manipulation of ideologies is no longer even a thinly-veiled attempt — we’re too sophisticated now and, in the common parlance of the often-discredited Youth, “like, totally over it.” We’re more liable to either be bored of the game and tune out altogether, leaving the fate of civilation largely in the hands of the elite forces who have only their own best interests at heart; or to make the seemingly logical decision that the best course of action is to play it, and play it well — in the hopes of making it into the upper echelons of elitedom, by which to survive Whatever May Come.

So: if we do collectively hold some deeply-seated love for Actual Reality, and seek to enjoy the pleasures of each other’s company in a more peaceably sane pursuit of gratitude at the wonders of existence (or at least, a tongue in cheek self-deprecating awareness of our utterly infinite lack of ability to directly do so), then we ought to resist more forcefully the current project we are collectively on — whether by choice or, more commonly, by being caught up in the accidental lottery of birth which placed us into this particular era at this particular time: full of self-important drudgery, decadent hedonism, pomp and circumstance, and neurotic self-obsession.

We cannot, as human beings imprisoned within the distortions of perception and cognition, in any objective sense “know” the world that is Out There. But the illusion is so compelling that we find ever more seemingly obvious ways to convince ourselves that the knowledge is ever just out of reach — if we could only move a little bit faster towards it, we will surely catch it.

Meanwhile the individuals most drawn to the pursuit of wealth and power — the most arguably useful symbols one can wield in one’s pursuit of planetary domination via ideological colonization — have us zealously convinced of the above fallacy throughout every age. Playing on our deepest psychological weaknesses, it gets easier and easier to do so via application of all the modern tools in the toolbox of propaganda at our disposal, that only increase in number under the guise of the “progress” that curiously seems to benefit the wealthy and powerful in an asymmetrical way, versus providing promised benefits more broadly.

This is why we can’t have nice things

Or rather, why we can only have nice Things, and we can’t seem to find a way to enjoy the suspiciously elusive things which are not Things. The simple and ephemeral joys that only well up from In Here, from love to joy, empathy to compassion, are simply not measurable by the sophisticated rational-scientific methods we have thus far been able to invent. Not indexable, not capturable by market predictions or mathematical modeling, they teeter on the edge of a steep precipice inside of an aggressively advancing value system that resists being unhinged from the comforting certainty of statistical analysis — left flapping out in the harsh, unpredictable winds of uncertainty and risk.

Paradoxically (and somewhat hilariously), we often wonder why we’re so terribly bored and full of ennui at the whole otherwise astonishing business of life (once unmoored from the over-interventionism of the Business of Life). We cannot seem to grasp that all of our efforts at stamping out variability and disorder work precisely against us — distancing ourselves from the organic, unplanned diversity of the natural world that did just fine on its own, thank you very much, before it perhaps made the mistake of running into the set of random conditions that proved hospitable enough to produce our tragedy of a species: so well-intentioned, so brilliant and well-meaning, yet so horribly, pathologically, depressingly Quite Lost.